Since the apprenticeship levy was introduced last year, apprenticeship starts have fallen in the construction trades by more than 10%.

Today at the Conservative Party conference, the Chancellor pledged to carry out a review of the levy, while also setting out plans to channel more training aid to smaller firms.

Currently, 10% of levy vouchers can be passed down through the supply chain from large contractors.

Under fresh plans announced today main contractors will be able to now share up to 25% of their funds with their supply chain subcontractors.

Hammond said: “We have heard the concerns about how the apprenticeship levy is working, so today we’ve set out a series of measures to allow firms more flexibility in how the levy is spent.

“But we know that we may need to do more to ensure that the levy supports the development of the skilled workforce our economy needs.

“So in addition to these new flexibilities, we will engage with business on our plans for the long-term operation of the levy.”

Brian Berry, Chief Executive of the Federation of Master Builders, said: “The Chancellor has, in part, listened to the concerns of business by making the Apprenticeship Levy more flexible. However, he needs to go much further.

“If the Chancellor is serious about ensuring the levy has the desired effect, and increases meaningful training across all sectors, it should go further and make 100% of the vouchers transferable from large to small companies.”